Although YouTube is by far the largest online video platform, its
live-streaming services aren't nearly as widely adopted as
Twitch's, which is presumably why it would want to buy the
startup.

If you visit Twitch, you'll be able to browse through a selection
of games that users are playing, and watch their gameplay either
live or from a recording. You can chat with other people who are
watching the same game.

Here's an example of what that would look like if you wanted to
watch someone play a WWE wrestling game:

Twitch also partners with all the major tournament companies to
stream their events on its site and has deals with partners like
CBS Interactive's GameSpot and Joystiq to offer their shows.

Like YouTube, Twitch inserts ads into streams, and broadcasters
can enter into partnership agreements to share the ad revenue. It
offers a subscription option for streamers who average about 1,000 viewers at any given
time, and for a monthly fee, those broadcasters can allow
others to subscribe to their streams, removing the
advertisements.

The three-year-old startup claims to have more than 45 million
monthly users, and it has more peak internet traffic than Facebook or
Hulu. Since becoming one of the first sites to host
user-generated, live-streamed video, it has raised $35 million in
funding.

Variety also reports that YouTube is preparing for U.S.
regulators to take a hard look at the potential acquisition to
make sure that it doesn't raise anti-competitive issues in the
online video market. If the acquisition happens, it would be the
largest in YouTube's history and would give it (and Google)
access to one of the internet's most highly trafficked websites.